20% diversify setting in GGBA

I've had some detailed correspondence with AC over the workings of the GBBA and in my view the diversification it offers is insufficient given that the provision fund is discretionary.

There are scenarios where you invest your cash and the GBBA immediately puts 20% of your cash into one loan (potentially a loan available in the secondary market that meets the criteria) whilst leaving the remainder of your cash uninvested.  If the investor loses patience or redeploys/withdraws some cash you can easily end up with a weighting in excess of 20%.  The GBBA will then try to sell it down to 20%, but only if the secondary market permits....(and the queue may be quite long).  I observed at one point that nearly 30% of my GBBA was invested in a single loan that I had steered clear of as I was building up a manual portfolio. Not what I had expected.

Interestingly the 20% isn't mentioned as a hard cap anywhere in the Ts&Cs that I could find - it is merely mentioned in an example.

I personally got rid of all my GBBA allocation and built a much more diversified portfolio of loans manually.  The added diversification in my view outweighs the value of the AC discretionary provision fund.  Of course this is subjective and depends on the loans you pick etc.

I am generally favourably disposed towards AC and it is one of my larger p2p platforms, but I feel the GBBA is a product that is insufficiently explained, and a much riskier proposition than I suspect most investors appreciate.

For comparison with duck , my GBBA top 5 holdings:

413 - 14.08% (pretty sure this was 20% at one point, but capital repayments have helped reduce this concentration)
327 - 10.38%
336 - 8.20%
227 - 7.48%
388 - 5.97%

19 holdings have 1% or more. 101 holdings in total currently, 134 holdings ever.

Currently 2 holdings are having 'issues', 208 and 330. Both of which I wasn't in on the MLIA (but had been previously). Total percentage for these two holding 3.5%, i.e. half the annual interest.

In comparison to duck top entry in both accounts, my holding in 441 is only my 12 largest, mainly due to it being made up mostly of reinvested interest I would suspect.

This does not guarantee diversification, as I tried it over a period of months. I found that each time I was being allocated a portion of the same loan, so after many deposits over a period I still had a near 20% exposure to one loan. 
When I checked the details it was certainly one I would have avoided at all costs.

Therefore I decided to sell out completely, however this is not as simple as claimed. I was returned ~80% after 7 days, 95% after a month, and 99.9% after 3 months, but still have "shrapnel" left that is stuck, presumably due to a default.

Therefore the claimed benefits do not, IMO, outweigh the significant drawbacks!

Drip feeding worked for me.  I think it depends on how many loans are in the pool at the time.  But I agree, it wasn't a good advice.

I am not sure the Auto Investment accounts are worth it. I would rather control the diversification and allocation of my own portfolio than have the discretionary provisions fund - which seems to be far less important than the security the loans are held against. I have a combination of the 30 day account and the manual account. I take money out of the 30 day to put in the manual investment account over time.

If provision funds have to be scrapped to achieve full FCA approval, it seems that the whole Assetz setup will crumble and only the original MLIA will survive.